Possible Layoffs at Toledo Jeep Plant

Date 1999/1/19 0:00:00 | Topic: Facilities

Reuters is reporting that due to slow Jeep sales in the Asia-Pacific from the economic crisis, DaimlerChrysler is discussing ways of throttling back production of the Wrangler and Cherokee in order to reduce inventory. The article says that sales are down 50% in the region and that both layoffs and a halting of production are being discussed with the UAW.

DaimlerChrysler is discussing options with the United Auto Workers union for its Toledo, Ohio, Jeep Wrangler and Cherokee plant in light of slumping sales in the Asia-Pacific region, a spokesman said on Friday.

The Toledo Blade newspaper reported on Friday that the company was considering laying off 265 to 365 of 4,700 hourly workers at the plant, or as much as 8 percent of the work force, and halting production of the Cherokee sport utility vehicle for eight weeks and the Wrangler for five weeks to reduce inventory.

A company spokesman declined to discuss possible layoffs or a production halt, but acknowledged that talks were being held with the union about the weaker overseas sales.

``We're talking to the UAW,'' said DaimlerChrysler spokesman Dan Moore. ``They're working on this, and until something actually happens, we won't know.''

``Of all the plants, Toledo did the most exporting, because the Cherokee and the Wrangler are popular models,'' Moore said. ``So definitely they are affected more then the other models.''

Moore said that U.S. sales of the Wrangler and Cherokee, which have been strengthening, could pick up some of the slack from the drop overseas, and the company could take other steps to counter the drop from Asia-Pacific.

The Blade reported that union officials were discussing with the company other possibilities rather than layoffs to cut costs at the plant.

DaimlerChrysler broke ground on a new 1.1 million-square-foot plant in Toledo this summer, which will build the redesigned version of the Cherokee, scheduled to hit dealer showrooms in 2001. The redesigned Cherokee is expected to help boost sales in a few years.